Selling silver

cinque1543

A friend of mine inherited 200 pounds of silver from his father, mostly in bars ranging from 1oz to 10oz in size. He wants to sell it all, and called a local dealer for an estimate. The dealer is offering 90% of spot. Does that sound like a reasonable offer?

tincup

Depends on what the bars are.... and whether your friend wants to take care of it as a 'one and done' transaction. Could he get melt or better? Sure, if he wants to do the work of selling on ebay, much more time and effort, etc.

Downtown1974

Like tincup said, depends on the bars. Some older poured bars can command big premiums over spot.

coastaljerseyguy

Sounds too low but an opening offer. Negotiate up to at least 94% but as others noted, if older 'named' bars cull them out and only sell the generic ones below spot.

mbogoman

Have him take a couple of sharp pictures of the bars (anything above an oz.) and post them here. We can tell you which ones he should keep out to sell separately from the main group.

Dave99B

That's too low for that kind of volume. I'd hold the line at 95%.

Dave

derryb

make sure your friend understands "stepped up basis" when he claims the income on his taxes. When calculating cost (basis) of an inherited item the cost is its market value at the time of inheritance not at the time it was purchased. This will save your friend a lot in income taxes (less on paper profit) on an appreciated item if of course he claims the income on his taxes or his buyer submits a 1099 on the purchase which will require him to report the income.

cinque1543

Thank you for your comments. I’ve passed them on to my friend.

jmski52

The comments in this thread are 100% good solid advice. Silver has been taking a real hit lately, and retail demand isn't that great right now, so bids will likely be less than spot. This too, will change.

cinque1543

So I've ended up helping my friend dispose of the silver that he inherited. I'm not a bullion guy, and I know almost nothing about silver bars, so I'm just helping with the silver coins, many of which are American Silver Eagles (ASEs).

This week I checked prices with three dealers, APMEX and two local brick-and-mortar dealers. One of the local dealers made the highest offer, at $36.50 per coin. On the same day, the APMEX website showed the price of silver as $38.57. So the $36.50 offer was 5.4% below spot.

Still on the same day, APMEX was selling BU ASE's at $43.58 each. This a premium of of 12.9%. So the hypothetical round-trip premium, or spread, was 18.3% (12.9% on the buy side + 5.4% on the sell side).

Again, this won't surprise you experts, but it surprised me. Based on this simple example, the price of silver has to rise by about 18% before it's possible for the retail buyer to make any money. Sound right?

derryb

bullionexchanges.com normally has the best buy prices.

jmski52

At this moment, Scotsman is buying ASEs at $0.90 over spot.

RedneckHB

@cinque1543 said:

Again, this won't surprise you experts, but it surprised me. Based on this simple example, the price of silver has to rise by about 18% before it's possible for the retail buyer to make any money. Sound right?

A few years ago some expressed caution of paying premiums. They were chastised and belittled.

derryb

@RedneckHB said:

@cinque1543 said:

Again, this won't surprise you experts, but it surprised me. Based on this simple example, the price of silver has to rise by about 18% before it's possible for the retail buyer to make any money. Sound right?

A few years ago some expressed caution of paying premiums. They were chastised and belittled.

there will always be premiums on the real stuff. Not unusual for premiums to go down as price goes up. If you bought silver at 20 with a 20% premium and sold it today at $38 with no premium, you made a good profit.

dcarr

@RedneckHB said:

@cinque1543 said:

Again, this won't surprise you experts, but it surprised me. Based on this simple example, the price of silver has to rise by about 18% before it's possible for the retail buyer to make any money. Sound right?

A few years ago some expressed caution of paying premiums. They were chastised and belittled.

.

A reasonable buy/sell spread for Silver Eagles is $1 to $2. By shopping around a little at a coin show or coin club meeting, a typical buyer/seller would only need a $0 to $2 increase in the silver price to break even (0% to about 5%).

Did anybody here actually pay a $5 (or higher) premium on ordinary/common/generic Silver Eagles (for example) ?
I do not personally know of anyone that ever did, anywhere, at any time.

I have argued against low-premium "paper" forms of silver (such as SLV), especially for longer-term holdings.
If anyone found that to be "chastising" and/or "belittling", then their skin is thinner than an unbacked paper promise.

.

blitzdude

@cinque1543 said:
So I've ended up helping my friend dispose of the silver that he inherited. I'm not a bullion guy, and I know almost nothing about silver bars, so I'm just helping with the silver coins, many of which are American Silver Eagles (ASEs).

This week I checked prices with three dealers, APMEX and two local brick-and-mortar dealers. One of the local dealers made the highest offer, at $36.50 per coin. On the same day, the APMEX website showed the price of silver as $38.57. So the $36.50 offer was 5.4% below spot.

Still on the same day, APMEX was selling BU ASE's at $43.58 each. This a premium of of 12.9%. So the hypothetical round-trip premium, or spread, was 18.3% (12.9% on the buy side + 5.4% on the sell side).

Again, this won't surprise you experts, but it surprised me. Based on this simple example, the price of silver has to rise by about 18% before it's possible for the retail buyer to make any money. Sound right?

Sounds about right. Have him check out the SLV if your friend is looking for a future no premium click buy click sell experience. It's the greatest invention since pickled eggs. RGDS!!

jclovescoins

https://www.collectpure.com/ is the best site to sell your silver